Reseller Hosting
Reseller hosting is no different either, a reseller buys a Web
hosting package from a hosting company and tries to sell it
independently. The profit for the reseller lies in either the
discount or in the commission s/he gets from selling an account.
For example: The reseller might purchase a package whose
features are valued at $100 for $90. So, the reseller stands to
make a $10 profit on selling the package to customers. Normally
as the customers increase, so does the profit margin for the
reseller.
Or, you can get some money by earning commissions from a hosting
company. This happens when you refer potential customers to the
hosting company. If the customer signs up with the company then
you earn a small recurring commission until the customer uses
the services.
Most web hosting companies try to outsource their services to
resellers as it helps them to extend their business reach
without the cost of marketing and sales and also helps them to
concentrate on the business side of things.
As a reseller you can decide what kinds of services you can
sell. You can provide shared, dedicated or co-location web
hosting or merchant accounts, store fronts etc.
If you go with hosting then it might be useful to offer some
other hosting related services like domain names, search engines
etc.
Of course, if you have problems selling these value added
services in the beginning then you can sell them later.
The cost of becoming a reseller and the equipment and people
required in order to be successful depends on many factors.
If you just plan to earn commission by referring people to the
hosting company by using the Internet, then you do not have to
put up a lot of money, all you need is an Internet ready PC and
an Internet connection.
For a small start-up not a lot of money and resources are
required. You can purchase a good reseller package from a
hosting company by paying them some money upfront. All that is
needed is a decent computer that can manage the accounts of
customers and a good Internet connection.
It is advisable to start small if you are very new to the
concept of web hosting and reselling. Then you can expand as you
go on and start getting more and more customers in which case
offering domain registration is also a very good way to make
profits.
If you have the money and the experience then you can go as far
as buying all the server equipment required, in which case you
will also be responsible for all the server maintenance costs.
The other option could be leasing a server as this will be
cheaper than buying the server, but here as well you are
responsible for all the maintenance and running costs of the
server.
In the above two cases you also need to make sure that you have
multiple connections with the hosting company so there are no
complications in case a connection goes down.
The best thing about being a reseller is that you do not require
a lot of upfront investment.
There is no need to have a lot of technical knowledge. Account
management and Internet skills are all that is required.
However, it would be really handy if you have some sales and
marketing experience so you can interact with your customers
better.
The hosting company generally provides and maintains all the
hardware and software.
You do not need to hire a lot of IT staff to provide support.
Providing basic support and leaving the more technical issues to
the parent company support staff can be easily achieved.
Support can sometimes be delayed, as you are dependent on the
parent company to handle the technical aspects. If there is a
delay from their side then you along with your customer are
affected.
Sometimes customers leave you if they find out that you are a
reseller and not a real hosting company.